With the aging of the population, more and more elderly persons are deciding (often with encouragement from their families) to give up the car keys. But they still need to get around.

As is often the case when a need arises, nonprofit organizations are stepping up to serve.

Ride assistance programs follow a number of different models. In most, volunteers drive their personal vehicles to transport clients to their appointments, shopping destinations, etc. In some (but not all) programs, volunteers are reimbursed for their expenses. Some programs charge clients for each ride while some charge a monthly fee. Still others do not charge—but make sure clients know how to make contributions to the organization if they choose. In some organizations, paid employees are responsible for all or part of the driving.

With so many different approaches to the mission of transporting the elderly safely and efficiently, questions often arise about what insurance is appropriate for ride-assistance programs.

For organizations that do not own vehicles:

Consider a “nonowned” auto liability policy. It protects the organization against third-party claims when employees or volunteers are at fault in an accident while driving their personal vehicles on behalf of the organization. The employee’s or volunteer’s personal liability insurance coverage would respond first.  But if their own limits of liability are insufficient to cover the damage, the organization itself might be sued. In that event, the nonowned auto liability policy would provide additional protection. The policy does not cover physical damage to the employee’s or volunteer’s vehicle.

Cost varies by region, type of organization and other factors, but for an organization with five employees or volunteers, typical cost would be $150 a year.

If the organization rents or leases vehicles, consider including “hired” auto liability. It protects the organization for liability in the same way the nonowned auto policy does, but for hired vehicles.  Physical damage for hired vehicles is an additional coverage option.

For organizations that own vehicles:

A commercial automobile policy is a must. It protects the organization when employees and volunteers (or anyone else driving the organization’s vehicles with permission) are at fault in an accident while driving those vehicles. It also covers physical damage to the vehicles. The cost varies based on where the vehicles are garaged, and type of vehicle. Vans garaged in a large city—where the risk of an accident, or theft of the vehicle are considered greater—might cost $1,500 to $2,000 per year to insure. The same vehicles garaged in a small town might cost $800 to $900 per year to insure. Cars might be slightly less costly to insure.

For all organizations:

Nonprofits need procedures in place to ensure that any employee or volunteer driving on behalf of the organization is a safe driver. At a minimum, the organization’s management should check motor vehicle records regularly and require proof of current automobile liability insurance.

Also, it’s prudent to consider excess automobile liability insurance for volunteer drivers. This insurance provides limits of liability above those of the volunteer’s personal automobile coverage. Because many volunteers choose only the state-mandated minimum limits of liability, they can be at risk of a large financial loss should they be at fault in a serious accident while driving on behalf of the nonprofit organization for which they volunteer. Offering this insurance can help with recruiting volunteer drivers who are concerned about their potential liability.